The difference is who is selling the goods. Vendor finance is a supplier or manufacturer arranging or supporting finance for its own customers buying its own products, usually as part of the sale. An introducer simply passes a customer to a broker or lender — an accountant, dealer, consultant or trade contact — and does not arrange the finance itself.
In practice the distinction is how closely the finance sits to the product. A vendor arrangement is built into the point of sale, often with quotes prepared alongside the equipment specification. An introducer relationship is looser: you pass on a contact when funding comes up in conversation, and step back.
Whether either arrangement needs an FCA permission turns mainly on who the customer is. Finance to an incorporated business for business use sits outside the consumer credit regime, and that covers the bulk of equipment and commercial vehicle funding. Sole traders and partnerships are individuals in law, so their agreements can fall inside the regime depending on the amount and the purpose — broadly, business-purpose lending above £25,000 to an individual sits outside it, while smaller borrowing may not, and you should check the current position rather than assume. Finance to a private individual for personal use is squarely regulated.
Two other points catch people out. Being paid commission makes it much harder to argue you merely passed on a name, and advertising “finance available” is a financial promotion that needs approval by an authorised firm. Where a business wants to introduce regulated customers and be paid for it, the Introducer Appointed Representative route exists, appointed by an FCA-authorised principal — in our case Rural Finance Limited. This is general information, not legal or compliance advice, and your own position depends on your customer mix.
CW Asset Finance works with both introducers and suppliers, and we are an Appointed Representative of Rural Finance Limited (FRN 630701), which is authorised and regulated by the FCA. We are also NACFB members. If you are considering either arrangement, we will set out plainly how it works and what your responsibilities are before anything starts.